Mild weather leads to fall in energy prices and demand

WHOLESALE GAS and electricity prices fell in March due to the unseasonably mild weather, according to the Bord Gáis Energy Index.

The fall in demand for energy following the extreme weather conditions experienced in Europe in February, pushed the Bord Gáis Energy Index down 3 per cent to 152 in March, although it still remains 4 per cent higher than the same time last year.

Falls in the price of electricity and gas were behind the drop in the index, with oil prices remaining the same.

After two months of rising prices, the price of a barrel of oil stabilised at around $125 per barrel as concerns about relations between Iran and the West receded and concerns about the strength of China’s economy weighed on oil markets.

The natural gas element of the Bord Gáis Energy Index was down 11 per cent, due to a combination of weaker demand, healthy supplies of gas and relatively high stock levels. In addition, the price of gas was not impacted by the uncontrolled gas leak at Total’s Elgin platform in the North Sea toward the end of the month.

Electricity prices, which in Ireland are highly dependent on the price of gas, were 8 per cent lower, reflecting the fall in the price of gas as well as carbon.

European coal prices recovered at the end of March following subdued activity.